Travelling through Scotland – and after visiting several distilleries across Speyside and the Highlands while following developments in the Irish whiskey industry – it feels timely to note that the whisk(e)y world is entering an era of profound change. A generational shift toward non-alcoholic preferences, climate stress, and economic uncertainty are converging to reshape its future.

The Ozempic Generation
Leon Webb of Tamnavulin Distillery aptly describes today’s whisky culture as the “Ozempic generation” – a market increasingly focused on wellness, restraint, and image rather than high-ABV indulgence. Borrowed from the popular weight-loss drug, the phrase has come to symbolize a broader social movement centered on optimization and health. For much of the twentieth century, whisky was marketed as a mark of success and maturity. Today, younger consumers are more likely to measure achievement through fitness metrics and personal sustainability than luxury or status. Non-drinking has become socially aspirational rather than exceptional, leaving the industry in a quandary as it considers its future.

Climate Change
On a less personal – and more challenging note – the University of Aberdeen warns that climate change models predict longer droughts and prolonged low-flow periods, prompting Speyside distilleries to consider investing in water storage and catchment management. Because roughly half of Scotland’s malt whisky distilleries draw water from the River Spey or its tributaries, the region is especially vulnerable to basin-wide shortages as both surface and groundwater become less reliable. Already, several distilleries have reportedly had to halt or slow production earlier than usual. Glenfarclas and Glenglassaugh have spoken of “pause reduction” due to insufficient water, while others – including Macallan – have curtailed output following recent SEPA water-scarcity alerts. The effects ripple through the Spey catchment: Glenfiddich and Balvenie rely on the Robbie Dhu springs (within the Spey system), and Mortlach, Dufftown, Glendullan, BenRiach, Longmorn, Glenlivet, Glen Grant, Aberlour, and GlenAllachie, to name a few, all depend on the same fragile system. Highland distilleries such as Wolfburn, Glenmorangie, Old Pulteney, and Dalmore are not without challenges either. SEPA has issued early-warning water-scarcity alerts for parts of the region, and their coastal locations also bring exposure to North Coast storms and surge. To build resilience, Glenmorangie has installed an anaerobic-digestion wastewater plant as part of the Dornoch Environmental Enhancement Project (DEEP). Dalmore – currently closed to visitors for renovation and expansion – has not been subject to SEPA production restrictions at the time of writing. Other distilleries have yet to announce major adaptation projects, though Old Pulteney explicitly leans into its maritime identity.

Economic Headwinds
Beyond environmental stress, distilleries appear to face mounting economic pressure. International trade has become less predictable, given tariffs, shifting rules, and supply chain disruptions, and energy prices remain volatile. Costs for barley, glass, packaging, and shipping have risen sharply in recent years. Whisky, which once seemed as relatively insulated, now competes in a more cautious marketplace. In Ireland, the past 15 years brought a boom: from four operating distilleries in 2010 to around 50 by 2023, with the United States as the largest export market. But cracks are showing. Oversupply, slowing U.S. demand, rising input costs (energy, packaging, labor), and softer tourism revenues are all creating headwinds. A key differentiator is tariff exposure. Irish whiskey originating in the EU currently faces a 15 per cent U.S. tariff, whereas whiskey distilled in Northern Ireland – treated under the U.K.-U.S. framework – faces 10 per cent, the same rate as Scotch. This creates a de facto tariff boundary within the island. Major producers have already signaled strain. For instance, Roe & Co (Dublin) has entered an “extended pause” in production; Pernod Ricard temporarily suspended operations at Midleton; the Dublin Liberties Distillery closed in May; and others, such as Killarney Brewing & Distilling Co., have ceased operations citing tariff and cost pressures. U.S. demand has softened as shipments declined from the 2022 to 2024, roughly a third below the 2022 peak – amid pricing pressure and slower growth. The Irish Whiskey Association warns that even a 10 per cent tariff costs producers thousands of euros per week given extreme export dependence (about 95 per cent of Irish whiskey is exported).

Ireland vs Speyside: Different Exposures
Irish whiskey’s dependence on the U.S. market, and the prevalence of smaller, newer producers with tighter margins, makes the sector highly sensitive to cost disruptions. Scotch, while also export-oriented, often benefits from larger multinationals with global portfolios, but it faces intense climate pressure on water, alongside energy and regulatory costs. The upside? Irish producers may pivot towards non-U.S. markets or adjust production profiles. Scotch producers, on the other hand, can further diversify markets and may enjoy a relative advantage if tariff policies tilt towards U.K. goods.

A Paradigm Shift
For whisky in both Scotland and Ireland, the challenge is not merely economic but philosophical: how do you preserve the mystique of a centuries-old craft when consumers are moving towards moderation – or abstinence? What’s clear is that the “water of life” now depends more directly than ever on the health of the rivers that sustain it, the lifestyle choices of its consumers, and geopolitical tensions in key export markets. Ultimately, each distillery faces a hard choice: accept intermittent shutdowns; invest heavily in infrastructure to secure future water; or diversify into new products and markets. Not long ago, distilleries primarily competed on flavor, identity, and brand. Increasingly, they now compete for relevance. In the wider view, the very element that gave whisky its soul may yet decide its survival.

~Story by Gregory J. Cran